New York (Platts)--8Jun2007

A coal industry group advising the federal government said that efficiency
measures can help address carbon dioxide emissions from the power sector in
the near term, but the group warned that plant owners could be discouraged
from investing in improving energy efficiency of existing plants for fear that
it would trigger New Source Review regulations. 

"Efficiency improvements at existing plants should be expedited ... this can
be achieved both technically and economically ... but regulatory barriers must
be addressed, including modifying the NSR process," the National Coal Council
said in releasing a draft of a wide-ranging study on technologies to reduce or
capture and store CO2 emissions.

The council said that NSR should not be triggered for plant efficiency
improvements that reduce CO2 emissions with no subsequent increase in sulfur
dioxide or nitrogen oxide emissions. 

TXU Wholesale Chairman Mike McCall, who is also chairman of the NCC, presented
the draft study and its recommendations during a council meeting in
Washington, DC, on Thursday. 

Introducing the study, McCall said that a "broad spectrum of technologies" is
needed to tackle the issue of GHG emissions from the power industry.
Government support is crucial in supporting the industry because technologies
are "still in early stages of development."

The study presented a three-sided approach to reducing GHG emissions from the
power sector, with efficiency measures being the key solution to reducing
pollution in the near term. The study also recommended that technology for
carbon capture and storage must be developed and demonstrated over the long
term, and "several major CCS projects must be started as soon as possible in
order to achieve commercialization within the next 15 years."

In addition to efficiency measures and CCS technologies, the study authors
said that advanced coal technologies such as integrated gasification
combined-cycle and ultra-supercritical combustion "must be given public policy
support and permitting incentives and financial support for initial
developments so they can succeed in the marketplace."

-- Marcin Skomial, marcin_skomial@platts.com